n January 4, JC sells merchandise costing $2,000 for $8,000 to RM with terms of 3/12, n30. On January 10, RM returns one tenth of the merchandise because it was the wrong size. On January 16, RM pays for the goods purchased from JC. What is a possible entry by RM on Jan. 16? Group of answer choices Debit A/P $6,984 and Credit Cash $6,984. Debit Cash $6,984 and Debit Sales Discounts $216 and Credit A/R $7,200. Debit A/P $7,200 and Credit Cash $6,984 and Credit Merchandise Inventory $216. Debit A/P $8,000 and Credit Cash $8,000. Debit A/P $7,200 and Credit Cash $7,200.
n January 4, JC sells merchandise costing $2,000 for $8,000 to RM with terms of 3/12, n30. On January 10, RM returns one tenth of the merchandise because it was the wrong size. On January 16, RM pays for the goods purchased from JC. What is a possible entry by RM on Jan. 16? Group of answer choices Debit A/P $6,984 and Credit Cash $6,984. Debit Cash $6,984 and Debit Sales Discounts $216 and Credit A/R $7,200. Debit A/P $7,200 and Credit Cash $6,984 and Credit Merchandise Inventory $216. Debit A/P $8,000 and Credit Cash $8,000. Debit A/P $7,200 and Credit Cash $7,200.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On January 4, JC sells merchandise costing $2,000 for $8,000 to RM with terms of 3/12, n30. On January 10, RM returns one tenth of the merchandise because it was the wrong size. On January 16, RM pays for the goods purchased from JC. What is a possible entry by RM on Jan. 16?
Group of answer choices
Debit A/P $6,984 and Credit Cash $6,984.
Debit Cash $6,984 and Debit Sales Discounts $216 and Credit A/R $7,200.
Debit A/P $7,200 and Credit Cash $6,984 and Credit Merchandise Inventory $216.
Debit A/P $8,000 and Credit Cash $8,000.
Debit A/P $7,200 and Credit Cash $7,200.
Expert Solution
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Solution
Concept
Credit term 3/12, n30 means that if the amount is paid within 12 days of the invoice date then 3% discount is given otherwise the normal credit period is 30days
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